16 February Charlie Munger, 98-summer investor, vice president of Berkshire Hathaway and partner of Warren Buffett, answered journalists' questions about inflation, criticized cryptocurrencies and some brokers.
About inflation
US inflation hit 40-year high in January, and the consumer price index year on year added 7,5%. Such a rise in prices is forcing the regulator to tighten policy and raise interest rates sooner.. It affects the stock market: S&P 500 and Nasdaq since the beginning of 2022, they have already sunk by 6 And 11%.
“Inflation is the biggest long-term danger for us, other than nuclear war. If you overdo it with inflation, civilization can be destroyed.", - Munger said with a reference to hyperinflation in the Roman Empire.
About cryptocurrency
Just like Buffett, Munger is skeptical about cryptocurrencies. The investor even compared them to venereal diseases: "I want to, to ban all this immediately. I think, the Chinese are right, that banned mining, and we were wrong".
Munger has long criticized bitcoin for its high volatility and lack of regulation.: “We already have a digital currency. This is a bank account.".
About trading
In January 2021, users of the Reddit forum began to collectively buy stocks of companies with a large volume of short positions.. As a result, there was a short squeeze in the shares of GameStop, and securities for the month rose by almost 2000%.
Munger criticized trading platforms, that gamify the purchase of shares and actively attract amateur investors: “A huge short squeeze at GameStop is overkill. For some stock market - like a casino.
“I would make it impossible to make short-term profits from securities. We confuse legal activity with a casino. When these two things mix, it's a speculative mess.", Munger added..
About technology
Munger and Buffett avoided investing in technology companies for a long time, but in recent years they have changed their minds: "Warren and I came into tech, like newborn babies. Reality dragged us there. This is true for all of America.. Technology isn't going anywhere.".
Nearly half of Berkshire Hathaway's portfolio is Apple stock. According to Munger, Apple is a strong company, which is well managed.
Stock portfolio
Charlie Munger answered journalists' questions at the Daily Journal's annual shareholder meeting. It's a publishing company, and Munger is its chairman. The publisher also has a portfolio of shares, run by Munger. The portfolio consists of shares of five issuers in the amount of $259 million.
Daily Journal positions at the end of 2021, million dollars
| Company | Asset value |
|---|---|
| Bank of America (BAC) | 102,3 (39,6%) |
| Wells Fargo (WFC) | 76,4 (29,5%) |
| Alibaba ADR (BABA) | 71,5 (27,7%) |
| U. S. Bancorp (USB) | 7,9 (3,0%) |
| POSCO ADR (PKX) | 0,6 (0,2%) |
Asset value
